NIPPON KANZAI Holdings Co (9347) Q2 2025 earnings summary

Executive summary

• Net sales rose 14.6% year-over-year to ¥65,319 million for 1H FY3/25, driven by contract renewals and construction orders.

• Operating profit declined 6.7% YoY to ¥3,730 million due to higher personnel and other expenses.

• Ordinary income decreased 7.1% YoY to ¥4,163 million, impacted by lower foreign exchange gains.

• Profit attributable to owners of parent fell 25.2% YoY to ¥2,278 million, impacted by litigation losses and foreign exchange effects.

Financial highlights

• Gross profit rose 46.8% YoY to ¥18,590 million; SG&A expenses increased 71.5% YoY to ¥14,860 million.

• Total assets grew 1.2% from March 31, 2024, to ¥93,760 million, mainly due to the consolidation of Keystone Pacific Property Management, LLC.

• Net assets rose 1.0% to ¥69,826 million, with an equity ratio of 71.4%.

• Cash and cash equivalents at period end were ¥31,384 million, up ¥2,008 million from prior year.

• Free cash flow improved to ¥2,483 million from negative ¥1,295 million YoY.

Outlook and guidance

• Full-year FY3/25 net sales forecast at ¥136,500 million, up 11.3% YoY; operating profit forecast at ¥8,500 million, up 2.8% YoY.

• Ordinary income forecast at ¥9,000 million and profit attributable to owners of parent at ¥6,100 million.

• No change to initial full-year guidance despite 1H profit shortfall, citing stable market and risk conditions.

• Interim and year-end dividends set at ¥27 per share, total ¥54 per share, with a forecast payout ratio of 33.1%.